Monday, December 15, 2014
Today the Supreme Court issued a 5-4 decision in Dart Cherokee Basin Operating Co. v. Owens. It’s an interesting breakdown. Justice Ginsburg writes the majority opinion, joined by Roberts, Breyer, Alito, and Sotomayor. The dissenters are Scalia, Kennedy, Thomas, and Kagan.
The question presented in Dart Cherokee involves what a party must include in a notice of removal. The answer, from Justice Ginsburg’s majority opinion:
To assert the amount in controversy adequately in the removal notice, does it suffice to allege the requisite amount plausibly, or must the defendant incorporate into the notice of removal evidence supporting the allegation? That is the single question argued here and below by the parties and the issue on which we granted review. The answer, we hold, is supplied by the removal statute itself. A statement “short and plain” need not contain evidentiary submissions.
In sum, as specified in §1446(a), a defendant’s notice of removal need include only a plausible allegation that the amount in controversy exceeds the jurisdictional threshold. Evidence establishing the amount is required by §1446(c)(2)(B) only when the plaintiff contests, or the court questions, the defendant’s allegation.
The dissenters in Dart Cherokee don’t challenge the majority on this. The cause of the disagreement, rather, is an issue that received considerable attention during the oral argument—one that was first flagged by Public Citizen in an amicus brief questioning the proper standard of review and the extent to which the Supreme Court could review a Court of Appeals’ decision to deny permission to appeal under the Class Action Fairness Act (CAFA). Review of the Tenth Circuit’s decision was complicated by the fact that it issued only a short order that failed to explain why it denied permission to appeal the district court’s remand order.
Justice Ginsburg finds that these concerns did not prevent Supreme Court review in this case, noting that “[t]he case was ‘in’ the Court of Appeals because of Dart’s leave-to-appeal application, and we have jurisdiction to review what the Court of Appeals did with that application. See 28 U. S. C. §1254; Hohn v. United States, 524 U. S. 236, 248 (1998),” and that “[t]here are many signals that the Tenth Circuit relied on the legally erroneous premise that the District Court’s decision was correct” in denying permission to appeal. In remanding the case, however, Justice Ginsburg notes that “[o]ur disposition does not preclude the Tenth Circuit from asserting and explaining on remand that a permissible ground underlies its decision to decline Dart’s appeal.”
Justice Scalia writes the dissenting opinion, arguing that the Court should have dismissed the writ as improvidently granted.
“Because we are reviewing the Tenth Circuit’s judgment, the only question before us is whether the Tenth Circuit abused its discretion in denying Dart permission to appeal the District Court’s remand order. Once we found out that the issue presented differed from the issue we granted certiorari to review, the responsible course would have been to confess error and to dismiss the case as improvidently granted.”
The most amusing part of the Dart Cherokee decision comes in Justice Scalia’s dissent, where he responds to Justice Ginsburg’s observation that a 2013 case, Standard Fire v. Knowles, came to the Court in a similar posture, yet Justice Scalia joined that decision without raising these concerns. Justice Scalia writes:
As for my own culpability in overlooking the issue, I must accept that and will take it with me to the grave. But its irrelevance to my vote in the present case has been well expressed by Justice Jackson, in a passage quoted by the author of today’s opinion: “I see no reason why I should be consciously wrong today because I was unconsciously wrong yesterday.” Massachusetts v. United States, 333 U. S. 611, 639–640 (1948) (dissenting opinion), quoted in Burwell v. Hobby Lobby Stores, Inc., 573 U. S. ___, ___, n. 11 (2014) (slip op., at 12, n. 11) (GINSBURG J., dissenting).
Finally, it’s worth noting that Justice Thomas does not join the final sentence of Justice Scalia’s dissenting opinion, where Justice Scalia writes that he would vote “to affirm” the Tenth Circuit if the writ were not dismissed as improvidently granted. This is because, as Justice Thomas explains in a separate dissenting opinion, he believes that the Supreme Court lacks jurisdiction even to review the Tenth Circuit’s decision under 28 U.S.C. § 1254.
Sunday, December 14, 2014
On Friday the Supreme Court granted certiorari in several new cases. A couple of them raise some interesting federal-courts issues.
Bullard v. Hyde Park Savings Bank (No. 14-116) presents the question: Whether an order denying confirmation of a bankruptcy plan is appealable.
Toca v. Louisiana (No. 14-6381) is a follow-up to the Supreme Court’s 2012 decision in Miller v. Alabama, which found that the Eighth Amendment forbids life-without-parole sentences for juvenile offenders. It presents the questions:
1) Does the rule announced in Miller apply retroactively to this case?
2) Is a federal question raised by a claim that a state collateral review court erroneously failed to find a Teague exception?
Thursday, December 11, 2014
Gelboim, which involves appellate jurisdiction in the context of MDL proceedings, presents the question: “Whether and in what circumstances is the dismissal of an action that has been consolidated with other suits immediately appealable?”
Wong and June both ask whether certain time limitations contained in the Federal Tort Claims Act are subject to equitable tolling, prompting the Court once again to consider which obstacles to relief qualify as “jurisdictional.”
Wednesday, December 10, 2014
Federal Rule of Evidence 606(b) is one of the few evidence rules that usually makes the crossover into Civil Procedure books. Continuing its expansive reading in Tanner v. U.S. of 606(b)'s general prohibition on juror testimony on an inquiry into the validity of a verdict, the Court yesterday issued Warger v. Shauers, which held that Rule 606(b) barred juror testimony in a proceeding to obtain a new trial on the ground that a juror lied during voir dire.
EvidenceProf Blog had a good post summarizing the case yesterday.
Monday, December 8, 2014
Although I have only a passing familiarity with the incredibly convoluted BP litigation, I predicted this summer (but not publicly), when BP filed its petition, that the Court would deny cert. BP repeatedly attempted to undo a settlement agreement that it negotiated for a year and strongly advocated to be approved at the time, and the procedural posture of its cert petition was murky.
Based on a quick reading of the cert petition, it seemed to me that BP mischaracterized both the settlement agreement and the lower courts' orders so it could manufacture a claimed "circuit split." BP characterized the class as including people who suffered no damage traceable to Deepwater Horizon, but that didn't seem accurate to me. I think that under the settlement agreement (which is 1,000 pages long and I admittedly have not read it), the claimants have to file a form that certifies that they did suffer such damage. BP, which agreed to that in the settlement, later changed its mind and said that wasn't good enough proof.
In 2012 the Court also denied cert in the DB Investments (a/k/a De Beers Diamonds) antitrust class action, which was cited in BP's cert petition. Objectors to the De Beers settlement agreement urged a similar argument that some class members had no cognizable claim.
Friday, December 5, 2014
A couple of interesting posts this week about standing issues in some high-profile pending and perhaps-soon-to-be-once-again-pending Supreme Court cases:
- Richard Re, Is Fisher v. University of Texas a Precedent on Jurisdiction? (Re’s Judicata)
- Will Baude, The standing problem in Zivotofsky, revisited (Volokh Conspiracy)
Monday, November 17, 2014
We covered earlier the Supreme Court’s per curiam decision in Johnson v. City of Shelby summarily reversing the Fifth Circuit. It’s a short opinion—just two and a half pages—but it has some important things to say about pleading standards. Here are a few quick thoughts:
The primary issue in the case is whether the district court properly rejected the plaintiffs’ due process claim for failing to invoke 42 U.S.C. § 1983 explicitly in their complaint. The Fifth Circuit had affirmed based on a misguided line of lower court decisions finding complaints to be “fatally defective” for failing to cite § 1983. The Supreme Court’s Johnson opinion makes clear that this line of cases is wrong—a plaintiff’s failure to cite § 1983 in his or her complaint is not fatal. From page 1 of the slip opinion: “Federal pleading rules call for ‘a short and plain statement of the claim showing that the pleader is entitled to relief,’ Fed. Rule Civ. Proc. 8(a)(2); they do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted.”
Nonetheless, the Court states that—on remand—the Johnson plaintiffs “should be accorded an opportunity to add to their complaint a citation to § 1983.” [Slip Op., p.3] This is admittedly somewhat puzzling. Why would there be any need to amend the complaint to include something that is not required? One possible explanation is that the plaintiffs had asked the district court for leave to amend the complaint, but the court refused and the Fifth Circuit affirmed that refusal. It is valuable, therefore, for the Supreme Court to reemphasize—with its citation to Rule 15(a)(2)—the Federal Rules’ instruction that “[t]he court should freely give leave when justice so requires.” [See Slip Op., p.3] In any event, the Supreme Court simply insists that the plaintiffs have an opportunity to add a citation to § 1983 to their complaint (as they requested). Given the Supreme Court’s conclusion that no such citation is required, it would be entirely proper for the Johnson plaintiffs and the lower court to agree that no amendment to the complaint is necessary in order for the plaintiffs’ claims to be resolved on the merits.
The most intriguing part of the Supreme Court’s Johnson opinion, however, may be the paragraph discussing Twombly and Iqbal. The Court initially notes that Twombly and Iqbal do not resolve whether the plaintiffs were required to cite § 1983 in the complaint, because Twombly and Iqbal “concern the factual allegations a complaint must contain to survive a motion to dismiss.” [Slip Op., p.2 (court’s emphasis)] But the Court goes on to say that the complaint in Johnson was “not deficient” under Twombly and Iqbal because the plaintiffs “stated simply, concisely, and directly events that, they alleged, entitled them to damages from the city. Having informed the city of the factual basis for their complaint, they were required to do no more to stave off threshold dismissal for want of an adequate statement of their claim. See Fed. Rules Civ. Proc. 8(a)(2) and (3), (d)(1), (e).” [Slip Op., pp.2-3]
Can a plaintiff really comply with Twombly and Iqbal merely by “stat[ing] simply, concisely, and directly events that, they alleged, entitled them to damages from the city”? Yes. Keep in mind: even Iqbal recognized that non-conclusory allegations must be accepted as true at the pleadings phase, without any inquiry into whether the truth of those allegations is plausibly suggested by other allegations. One of many frustrating aspects of the Iqbal majority opinion was that it failed to explain what made the crucial allegations in the Iqbal complaint too conclusory to be accepted as true. But I’ve argued elsewhere that one way to make sense of Twombly and Iqbal—in light of the text and structure of the Federal Rules and Supreme Court precedent that remains good law—is through a transactional approach to pleading. That is, an allegation is conclusory when it fails to identify adequately the acts or events that entitle the plaintiff to relief from the defendant. It is only when an allegation obscures the underlying real-world events with mere legal conclusions that it should be disregarded as conclusory under Iqbal.
On this point, it’s particularly interesting that the plaintiffs’ claim in Johnson was “that they were fired by the city’s board of aldermen, not for deficient performance, but because they brought to light criminal activities of one of the aldermen.” [Slip Op., p. 1] Such a claim—like the claim at issue in Iqbal—hinges on the defendants’ intent. Properly understood, Iqbal does not hold that an allegation is “conclusory” simply because it alleges that a defendant acted with a certain state of mind. Rather, such an allegation should be accepted as true—including its description of the defendant’s intent—as long as it provides a basic identification of the liability-generating events or transactions. The Supreme Court’s reasoning in Johnson is consistent with this approach, and confirms that Twombly and Iqbal need not be read to impose heightened burdens on plaintiffs at the pleadings phase.
All in all, Johnson v. City of Shelby is a short-but-sweet per curiam opinion that not only gets the right result on the primary issue presented, but also reflects a more sensible approach to pleading generally. Lower courts should take note.
Saturday, November 15, 2014
On Monday we covered Johnson v. City of Shelby, a per curiam Supreme Court decision on pleading that summarily reversed the Fifth Circuit. Here’s some of the coverage of that decision from this past week:
- City of Shelby: New SCOTUS Pleadings Opinion in Visual Context (Colin Starger)
- SCOTUS Per Curiam Procedure Decisions Raise (At Least) As Many Questions As They Settle (Michael Dorf)
- Twombly’s Remorse (Barry Barnett)
Monday, November 10, 2014
We’ve been watching Johnson v. City of Shelby, a case raising some important questions on pleading standards that the Supreme Court relisted several times. Today the Court issued a per curiam decision summarily reversing the Fifth Circuit. It appears following today’s order list (beginning at page 11 of the .pdf file). Here are some highlights:
Plaintiffs below, petitioners here, worked as police officers for the city of Shelby, Mississippi. They allege that they were fired by the city’s board of aldermen, not for deficient performance, but because they brought to light criminal activities of one of the aldermen. Charging violations of their Fourteenth Amendment due process rights, they sought compensatory relief from the city. Summary judgment was entered against them in the District Court, and affirmed on appeal, for failure to invoke 42 U. S. C. §1983 in their complaint.
We summarily reverse. Federal pleading rules call for “a short and plain statement of the claim showing that the pleader is entitled to relief,” Fed. Rule Civ. Proc. 8(a)(2); they do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted. See Advisory Committee Report of October 1955, reprinted in 12A C. Wright, A. Miller, M. Kane, R. Marcus, and A. Steinman, Federal Practice and Procedure, p. 644 (2014 ed.) (Federal Rules of Civil Procedure “are designed to discourage battles over mere form of statement”); 5 C. Wright & A. Miller, §1215, p. 172 (3d ed. 2002) (Rule 8(a)(2) “indicates that a basic objective of the rules is to avoid civil cases turning on technicalities”).
Our decisions in Bell Atlantic Corp. v. Twombly, 550 U. S. 544 (2007), and Ashcroft v. Iqbal, 556 U. S. 662 (2009), are not in point, for they concern the factual allegations a complaint must contain to survive a motion to dismiss. A plaintiff, they instruct, must plead facts sufficient to show that her claim has substantive plausibility. Petitioners’ complaint was not deficient in that regard. Petitioners stated simply, concisely, and directly events that, they alleged, entitled them to damages from the city. Having informed the city of the factual basis for their complaint, they were required to do no more to stave off threshold dismissal for want of an adequate statement of their claim. See Fed. Rules Civ. Proc. 8(a)(2) and (3), (d)(1), (e). For clarification and to ward off further insistence on a punctiliously stated “theory of the pleadings,” petitioners, on remand, should be accorded an opportunity to add to their complaint a citation to §1983. See 5 Wright & Miller, supra, §1219, at 277–278 (“The federal rules effectively abolish the restrictive theory of the pleadings doctrine, making it clear that it is unnecessary to set out a legal theory for the plaintiff’s claim for relief.” (footnotes omitted)); Fed. Rules Civ. Proc. 15(a)(2) (“The court should freely give leave [to amend a pleading] when justice so requires.”).
Friday, November 7, 2014
Whether, under Federal Rule of Civil Procedure 4(m), a district court has discretion to extend the time for service of process absent a showing of good cause, as the Second, Third, Fifth, Seventh, Ninth, Tenth, and Eleventh Circuits have held, or whether the district court lacks such discretion, as the Fourth Circuit has held?
You can find links to the cert. stage briefing (as well as the merits briefs as they come in) at SCOTUSblog’s Chen case file.
Thursday, October 16, 2014
Cases on Tap for Tomorrow’s SCOTUS Conference: Are Cert Grants Coming on Pleading and Personal Jurisdiction?
A couple of cases on the calendar for tomorrow's Supreme Court conference are worth a quick mention. Both appear on SCOTUSblog’s "relist" list. (That they had already been calendared for previous conferences and avoided a quick cert. denial presumably means they generated at least some interest or need for further inquiry.)
One is Johnson v. City of Shelby, a case out of the Fifth Circuit that raises some interesting questions about pleading standards that we covered earlier. This is the second time Johnson has been relisted.
Another is AEP Energy Services v. Heartland Regional Medical Center, a case out of the Ninth Circuit on personal jurisdiction. Here are the questions presented in AEP:
1. Whether due process permits a court to exercise specific personal jurisdiction over non-consenting, out-of-state defendants based on the plaintiffs’ bare allegation that the defendants engaged in a nationwide conspiracy outside the forum that had an intended effect inside the forum (as well as presumably in every other state).
2. Whether due process permits a court to exercise specific personal jurisdiction over non-consenting, out-of-state defendants when the defendants’ limited forum conduct bears no causal relationship to the plaintiffs’ claim.
You can find all of the AEP cert-stage briefs at SCOTUSblog. The Ninth Circuit’s opinion is In re Western States Wholesale Natural Gas Antitrust Litigation, 715 F.3d 716.
Wednesday, October 15, 2014
Over on the Courts Law section of JOTWELL is an essay by Lee Epstein entitled The Depreciation of Precedent. It reviews an article by Ryan Black and James Spriggs that was recently published in the Journal of Empirical Legal Studies.
Thursday, October 9, 2014
1. Is a federal complaint subject to dismissal when it fails to cite the statute authorizing the cause of action?
2. Do the lower federal courts have authority to create pleading requirements for complaints when those requirements are not contained in the Federal Rules of Civil Procedure?
3. Should a federal complaint be dismissed when it alleges the elements of a 42 U.S.C. § 1983 claim, but does not cite 42 U.S.C. § 1983?
It's been re-calendared for this Friday's conference (10/10). Here's the Fifth Circuit's decision below.
(Hat Tip: Shaun Shaughnessy)
Tuesday, October 7, 2014
Here is the transcript from today's oral argument in Dart Cherokee Basin Operating Co. v. Owens. Some pretty interesting exchanges--although many of them had nothing to do with the actual question presented. The Justices spent a considerable amount of time on the jurisdictional/abuse-of-discretion argument first raised by Public Citizen in an amicus brief.
The question for which cert. was granted was this:
"Whether a defendant seeking removal to federal court is required to include evidence supporting federal jurisdiction in the notice of removal, or is alleging the required 'short and plain statement of the grounds for removal' enough?"
As to that issue, Justice Kagan commented to Petitioner's counsel that "most of us agree with you on the merits," although Justice Alito quickly responded, "That might be a little premature." [p.21]
The whole transcript is worth a read (if you're into that sort of thing), but here's one exchange between Justice Breyer and Respondent's counsel that speaks volumes about the state of pleading standards after Twombly and Iqbal:
MR. SHARP: [T]hat was part of the district court's opinion. There were two parts. One was that there wasn't any evidence; and the second part was that it was conclusory, that there were no facts. All you said was 8.2 million. And so both of those were possible --
JUSTICE BREYER: Isn't that a fact?
MR. SHARP: Excuse me, Your Honor?
JUSTICE BREYER: Isn't 8.2 million a fact?
MR. SHARP: It's a conclusory fact.
JUSTICE BREYER: Well, it's a fact. They said in their view --
MR. SHARP: It's a conclusion.
JUSTICE BREYER: All right. I don't know what a conclusory fact is as opposed to a regular fact.
Sunday, October 5, 2014
First Monday, baby. And right out of the gate is Dart Cherokee Basin Operating Co. v. Owens, which will be argued on First Tuesday (October 7). The SCOTUSblog argument preview by Ron Mann (Columbia) says the case “could have come straight out of a law-school exam.” Here’s the question presented:
Whether a defendant seeking removal to federal court is required to include evidence supporting federal jurisdiction in the notice of removal, or is alleging the required “short and plain statement of the grounds for removal” enough?
There’s also an interesting side issue regarding the extent of the Supreme Court’s jurisdiction when a federal appellate court has exercised discretion to deny leave to appeal under the special appellate provisions of the Class Action Fairness Act [28 U.S.C. § 1453(c)]. An amicus brief filed by Public Citizen argues that “the only question properly before the Court in this case is whether the court of appeals abused its discretion when it denied leave to appeal.”
Monday, September 29, 2014
SCOTUSblog reports that the Court dismissed the writ of certiorari in Public Employees' Retirement System v. IndyMac MBS, Inc. as improvidently granted. The issue in the case was whether the filing of a putative class action serves, under American Pipe & Construction Co. v. Utah, to satisfy the three year time limitation in § 13 of the Securities Act with respect to the claims of putative class members.
The Court was set to hear argument in the case on Monday, but became aware of a pending settlement proposal.
Wednesday, September 17, 2014
Rich Freer (Emory) has posted on SSRN a draft of his article, Four Specific Problems with the New General Jurisdiction, which will be published in the Nevada Law Journal. Here’s the abstract:
General in personam jurisdiction allows a court to enter judgment against a defendant regarding a claim that did not arise in the forum. Traditionally, based upon International Shoe (1945), courts have exercised general jurisdiction over corporations based upon their "continuous and systematic" activities in the forum. In Goodyear Dunlop Tires Operations, S.A. v. Brown (2011) and Daimler AG v. Bauman (2014), the Supreme Court has restricted general jurisdiction by making it available only where the defendant is "at home" (a notion apparently never adopted by any state court as a proxy for general jurisdiction).
Goodyear and Daimler were easy cases. The lower courts' exercise of general jurisdiction in each was risible. Instead of simply reversing the efforts, the Court decided several issues it did not need to decide and upset accepted understanding of activities-based general jurisdiction. Because the Court has never explained why we have general jurisdiction, it failed to explain why the new restriction is needed or appropriate.
This article focuses on four specific problems created by the new jurisprudence: (1) the Court unnecessarily prohibits general jurisdiction based upon sales into a forum, which will hamper growth of jurisdictional doctrine in Internet cases; (2) by ignoring corporate activities, the Court ignores the sorts of corporate contact that would be analogous to human domicile, which, the Court says, is the paradigm of "at home"; (3) by rendering activities-based general jurisdiction practically impossible and (4) by inexplicably jettisoning the "fairness factors" of International Shoe in general jurisdiction cases, the Court exacerbates its parsimonious view of specific jurisdiction by denying judicial access to American plaintiffs injured by foreign corporations.
Though some restriction of general jurisdiction may have been appropriate, it should have been measured and well-tailored to the underlying purpose of general jurisdiction. The Court's recent effort is not.
Monday, August 18, 2014
We covered earlier the upcoming Hastings Law Journal symposium on the Supreme Court’s recent decision in Atlantic Marine Construction Co. v. U.S. District Court. It will take place in San Francisco on Friday, September 19th. Here’s an announcement/invitation with more details:
You are cordially invited to attend a symposium on Atlantic Marine v. U.S. District Court, a decision by the U.S. Supreme Court last Term that held forum-selection clauses to be enforceable under Sec. 1404(a)'s authorization of venue transfer. The symposium, co-sponsored by UC Hastings and Hastings Law Journal, will bring renowned scholars from across the country to discuss the importance of the decision and its implications for civil litigation. Up to 3.5 hours of California MCLE credit is available. Free and open to the public, the symposium will be held at UC Hastings College of the Law, 198 McAllister St., in the Louise B. Mayer Room from 1:00-4:30pm on Friday, September 19, 2014. A reception for all attendees will immediately follow. Register here: http://www.hastingslawjournal.org/symposium/.
Thursday, July 3, 2014
(1) Whether the Trademark Trial and Appeal Board’s finding of a likelihood of confusion precludes respondent from relitigating that issue in infringement litigation, in which likelihood of confusion is an element; and (2) whether, if issue preclusion does not apply, the district court was obliged to defer to the Board’s finding of a likelihood of confusion absent strong evidence to rebut it.
Hat tip: Professor Ira Nathenson, who also explained that the Trademark Trial and Appeal Board is not an Article III court, and that the nature of Likelihood-of-Confusion inquiries can vary between the TTAB and the District Court.
Monday, June 30, 2014
While everyone waits with bated breath for the Supreme Court to wrap up the current Term with decisions in Hobby Lobby and Harris, the Court granted certiorari in Gelboim v. Bank of America (No. 13-1174). From the cert petition, here is the question presented (with the usual wind-up):
The question “whether consolidated cases retain their separate identity or become one case for purposes of appellate jurisdiction has divided the courts of appeals.” United States ex rel. Hampton v. Columbia/HCA Healthcare Corp., 318 F.3d 214, 216 (D.C. Cir. 2003). “Some circuits hold that consolidated cases remain separate actions and no Rule 54(b) certification is needed to appeal the dismissal of any one of them. Others treat consolidated cases as a single action, or presume that they are, allowing the presumption to be overcome in highly unusual circumstances. Still other circuits apply no hard and fast rule, but focus on the reasons for the consolidation to determine whether the actions are one or separate.” Id. (citations and alterations omitted). This Court granted certiorari to resolve the conflict in Erickson v. Maine Central Railroad Co., 111 S. Ct. 38 (1990) (mem.), but the petition was subsequently dismissed, 111 S. Ct. 662 (1990) (mem.).
The Question Presented is:
Whether and in what circumstances is the dismissal of an action that has been consolidated with other suits immediately appealable?